DETROIT (AP) — Detroit's mayor warned Monday that the city could go broke if its top lawyer refuses to drop her lawsuit challenging a deal with Michigan officials that seeks to rescue the city from financial collapse.
The most recent clash between Mayor Dave Bing and the city's Corporation Counsel Krystal Crittendon underscores how precarious Detroit's situation remains, even after officials signed the deal in April letting the state take a more active role in city fiscal restructuring without the embarrassment of appointing an overseer to do the job.
Although Crittendon's lawsuit targets that so-called consent agreement, Bing and state officials say it also could imperil a separate contract allowing the city to sell bonds in order to pay short-term bills and make payroll for its approximately 10,000 employees. Bing told the City Council that $80 million in precious revenue sharing for the city could be withheld.
The legal conflict could scare off potential buyers of those bonds, Bing and state officials warn. If $137 million worth of bonds are not sold by June 27, the bank could intercept the revenue sharing money that was used to secure the loan.
"Without that, we're dead," Bing said. "We get into this lawsuit, and we get into this litigation, nobody knows how this is going to play out or how long it's going to take. In the meantime, we have no money to run the city."
Crittendon claims the consent agreement approved in April between Bing and Gov. Rick Snyder is null and void because Detroit's charter prohibits the city from entering into contracts where at least one side owes the other money. She and some on the council have said for months that the state owes Detroit $220 million in past revenue sharing.
Snyder has said the state doesn't owe the city the money. Crittendon didn't immediately return a call Monday from The Associated Press.
Detroit's new charter, approved last year by voters, gives the city's corporation counsel the authority to investigate violations of the document — meaning Bing and the Council can't force her to drop the suit. It takes six votes from the nine-member council to remove her.
If the lawsuit is not dropped by early this week, current revenue sharing could be withheld for payments on bonds, Deputy Treasurer Thomas Saxton wrote Thursday in a letter to Jack Martin, the city's chief financial officer. Saxton said the lawsuit challenging the consent agreement could cause concern among third parties interested in purchasing the bonds.
Detroit is due $25.1 million this month, $25.1 million in August, $27.7 million in October and $4.6 million in December, Saxton said.
Not only is Detroit's accumulated budget deficit more than $200 million, the city's long-term structural debt tops $13 billion.
Without the revenue sharing, Detroit would have a negative cash flow starting Friday and there "would be chaos," Council President Pro Tem Gary Brown told The Associated Press Monday. "After Friday, we won't be able to make payroll in two weeks."
Crittendon's lawsuit goes before a judge Wednesday. The City Council could vote Tuesday on a resolution asking her to drop it.
Bing asked Crittendon Saturday to drop the lawsuit and she said "no," Brown said.
"If I make the resolution tomorrow, I don't think there'll be the support for it," Brown said. "Everybody is in a stare down. It's like, who is going to blink?"
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This Week’s Celebrity Instagrams (11/26-12/2)
30 photos Launch gallery
1. Little Legend and Puddy 😍😍😍😍
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2. "You on point Phife?" "all the time,Tip". 💥 #bannedfromnormal
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3. Vegan! The Impossible burger at Crossroads
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4. Lawrence #BeforeandAfterEpisodes 1-4: 184lbs 13% body fatEpisode 8: 196lbs 8% body fat S/O @coachdaveboxing with the works outs and @kildareriordan with the nutrition
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5. Jus haaaanngin out
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6. Meanwhile back at home in Atlanta GA someone mad they not on the 🛳. 😳
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7. No limits... Photo cred: Chris Bridges @ludacris
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8. new new
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9. Apparently my 260lbs is too much for the actual vines in the Hawaiian jungles to hold me without breaking and me falling hundreds of feet. So for safety purposes, I'm forced to swing thru #Jumanjj on wires strong enough to hold 12 adult buffaloes and 1 adult Rock. #OnSet #Jumanji #IronicallyIEatBuffaloDailyForLunch #MoreManThanNatureKnowsWhatToDoWith
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10. hey ma! 🎎#wcw 💙
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11. Surprise visit to our factories!!! #GoodAmerican #USA
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13. Peachy Keen 🔥✨⚡️
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14. If this don't look thankful I don't know what does. Happy Thanksgiving to you and yours. #UltraBlessed #24kMagic #SweetPotatoFly
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15. Late nights @nbcmarlon with the writers... we in here!!!
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16. There goes my baaaaaaaaabbbbyyyyy #QueenKingMagic!!! We're up to something! Ira BIG!!! Stay out our buisness -
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17. You want to win every game you play but when you come home to these faces... who cares. #ILoveYouGirls best part of my day, everyday!
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18. Steady,steady..... full size jenga.. "I got this one "???? Or do I ?
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19. Cornrows kind of day 😉@dontaysavoy2 you convinced me and I love. ❤️️
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20. #BrotherlyLove #tbt
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22. #basel #TeamLOVE @kingcombs
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23. Just introduced a special screening of @directher 's groundbreaking (must see) documentary @13thfilm with my brother @themichaelealy | @unitedblackout #blackoutblackfriday
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24. Me & Vanessa Williams giving #DuckLips #Pose on the set of #DaytimeDivas @vh1 - Coming Soon to a tv near you. Lol. - My make up done by @makeupsurgeon
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25. This picture just makes me wanna praise the Lord, you hear me!!!!!! Yes Lord brotha #TEDDYCAMPBELL What a #man !!! You are everything right on this picture husband ......... #gorgeous #stylish #classy #strong #masculine #king #sexy #debonair #gentlemenstyle And that #bible in your hand just seals the deal for me (probably cause i know that, that is what helped you become just as amazing as you look😘). While my heart and mind experiences the goodness of God at #church on Sundays, my eyes experiences the goodness of Teddy😍. Amen somebody🙌🏽. "Bless the Lord oh my soul and all that is within me bless his holy name" #myman #myhusband #goodman #blackman #dapperman #godlyman #goodfather #mybestfriend
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26. Yesterday was my mama's 53rd birthday!!!!! Got to celebrate with her all day. If this is what I have to look forward to I can't wait. Looking like a soft bucket a cocoa butter. Yaaaaaaaaaas! 😍😍😍 love you mommy!
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27. "Shout out to @PureAtlanta for getting the family right"....I'm loving this jogger. 😍😍
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28. This pic warms my heart ❤️ #myLogiebeans and aunt aunt umba @itowandabraxton 😘
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29. You will always be my baby😜. #HappyBirthdayReginae #mybaby18
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30. GC "Gods Child" Red on Red SweatSuit available now at www.MonicaApparel.com ... Take Your Crown wherever you go!! I'm pictured in a Medium... Go to the site now for other options ... cc: @trukernell
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